Angelides Calls For Offshore S&P 500 Delisting

December 11, 2002 ( - Calling them "not bona fide American companies" and "a poster child for the kind of corporate behavior that repels most US citizens," California State Treasurer Paul Angelides, in conjunction with 9 other state treasurers and a comptroller-elect, has asked the Standard & Poor's (S&P) 500 Index to delist companies with offshore addresses.

Angelides, in conjunction with state treasurers from Connecticut, Maine, Massachusetts, Wyoming, Kentucky, Oregon, Iowa and the comptroller-elect from New York, has sent letters toS&P President Leo O’Neill, urging the S&P 500 to delist offshore companies; saying the practice of expatriation is part of a larger pattern of deception in the corporate boardroom, that has led to a loss of investor confidence in the financial markets.

“These paper relocations not only allow companies to avoid paying their fair share of taxes, but they also result in a significant weakening of important shareholder rights. This practice is part of a larger pattern of deception that has shaken our financial markets,” said a December 4 combined letter.

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Additionally, Angelides said in a press release, “we feel very strongly that corporations wanting all the benefits of operating in the U.S. without sharing in the responsibilities of American citizenship should not enjoy the privilege of the S&P 500 imprimatur.”

The state officials are seeking the delisting of six Bermuda-registered companies and four companies incorporated in the Cayman Islands.

Those companies are Noble Corp, Cooper Industries Inc, XL Capital Ltd, ACE Ltd, Tyco International Ltd and Ingersoll-Rand Co in Bermuda and Carnival Corp, Transocean Inc and McDermott International Inc in the Cayman Islands.

Bermuda’s finance minister, Eugene Cox, has denounced the idea, saying it is “short-sighted and nonsensical,” according to a Reuters report. “These companies had done nothing illegal and were engaged in legitimate business,” he said.

Angelides has taken a series of similar steps in recent months.   On Monday he released his  “Power of the Purse”  corporate reform manifesto, urging investors to invest in companies that demonstrate strong corporate ethics. Previously, the California State Treasurer’s Office  prohibited business deals with expatriate US companiesand adopted a set of    Investment Protection Principals requiring banks and money managers to meet new standards of disclosure.